• Price weighted : t = (60=20=18)/3 = $32.

67
• : t=1 = ( 80 + 35+ 25)/ 3= $ 46.67

• Percentage change = (46.67 – 32.67)/ 32.67 = 42.85%

• Market weighted = Price * No. of shares
• t= (60000000)+ 200,000000+ 540,000000 = $ 80000000
• T+1 = 80+350+750 = $1180
• % change = (1180-800)/800 = 47.50%
• At time t:
• A = 1000/60 = 16.67 shares
• B= 1000/ 20 = 50
• C= 1000/18 = 55.56 = $3000
• At time t+1:
• A= 80*16.67 = $ 1333.6
• B= 35* 50 = $1750
• C= 25* 55.56 = $ 1389 = $ 4470.6
• % change = 49.02%
A =20/60 =33.33%
B = 15/20 = 75%
C = 7/18 = 38.89%
AM =(33.33+75+38.89)/3 = 49.07%

GM= Take under root 3

• Day 1 = 12+23+52/3 = 87/3 = 29
• Day 2 = presplit = 10+22+55 = 87/3 = 29
• = post-split = 10+ 44 +55 = 109/ x = 29
• X= 3.75
• Day 3 = 14+46+52/ 3.75
• = 29.867pre-split

• Day 3 post-split = (14+46+26)/X = 29.867

• X = 2.87
• EMH
• Weak
• Semi-strong
• Strong
how to Test EMH
Autocorrelation : relationship b/w return of today with previous days

Return = % change = (Closing price- opening price)/ Opening price

• Efficient capital market
• A market in which new information is very quickly reflected accurately 
in share prices
• Market efficiency refers to how well current prices reflect all available,
relevant information about the actual value of the underlying assets.
• Why is Market Efficiency Important? The idea of market efficiency is
very important for investors because it allows them to make more
sensible choices. The only real way that they can get above average
profits through investments in the different markets is by taking
advantage of any abnormalities when they occur.